Tax-deferred retirement plans

Tax-deferred retirement plans

Employer-sponsored and other plans that allow contributions and earnings to be made and accumulate tax-free until they are paid out as benefits.

Tax-Deferred Retirement Plan

A retirement investment plan in which a contributor does not pay taxes on contributions until after withdrawal at retirement. That is, one places a portion of his/her pre-tax income into a retirement account that allows it to be invested. Taxation is deferred until withdrawal from the account following retirement. Presumably, one's tax rate will be lower after retirement because one's income is usually lower after retirement. Common examples of tax-deferred retirement plans include IRAs and traditional 401(k)s. Some employers make matching contributions to these plans.
References in periodicals archive ?
The same Internal Revenue Code that allowed you to save tax dollars when you contributed to those tax-deferred retirement plans also generally requires you to begin withdrawals on the year you reach age 70%.
Despite the popularity of tax-deferred retirement plans for both traditionally and self-employed savers, some advisors like to steer clear.
The Wall Street Journal reported that the government has estimated that it lost $136,000,000,000 in revenue to tax-deferred retirement plans in 2012.
They are a leading provider of 403(b) and 457(b) tax-deferred retirement plans, primarily in the K-12 school marketplace.
70 1/2--You must start taking minimum distributions from most tax-deferred retirement plans or face a 50% penalty on the amount that should have been withdrawn.
The first new 403(b) regulations in 40 years will increase employers' role as sponsors of these tax-deferred retirement plans, with respect to investments, transfers, documentation, plan administration, and participant disclosures, according to Lincoln Financial Group.
In the meantime, contribute the maximum amount possible to your employer's retirement or 401(k) tax-deferred retirement plans.
It discusses the characteristics of each of the various tax-deferred retirement plans, and which works best for individuals in different scenarios.
Putting money aside in tax-deferred retirement plans is another top priority even for those who are in debt.
By putting more money into your tax-deferred retirement plans, you actually reduce your taxable income, which translates into saving money.
They are now looking into tax-deductible, tax-deferred retirement plans for the self-employed, such as Keoghs and SEP-IRAs.
To understand why, a good starting place to look is 403(b) plans, which are tax-deferred retirement plans for employees of schools and other nonprofit organizations.